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EU car industry wants EU loan pledge before end of year

  Europe’s car industry wants an EU commitment by year-end to offer €40 billion in low-interest loans to help counter the global credit crunch.

 

The European Automobile Manufacturers Association said the loans would cover research into cleaner cars so the industry can meet EU goals to reduce air pollution blamed for climate change. The aid would come from the European Investment Bank, the 27-nation EU’s lending arm, which confirmed talks over the matter.

“The loans package is just helping us find the money we don’t find today at the banks,” Christian Streiff, president of the association and chief executive officer of PSA Peugeot Citroen, Europe’s second-biggest carmaker, told reporters today in Brussels. “We need provisional help.”

The EU is examining support for carmakers such as Peugeot and bigger competitor Volkswagen AG as it prepares to impose caps on auto emissions of carbon dioxide, the main greenhouse gas, and seeks to prevent the financial crisis from causing a prolonged economic slump.

Any European aid would follow $25 billion in low-interest loans that US rivals including General Motors Corp. and Ford Motor Co. are set to receive. A draft European law nearing final approval would limit emissions from all new cars sold in the EU beginning in 2012 and fine companies that go over their caps.

European auto sales fell for a fifth month in September, the longest stretch since 2005, the industry association, also known as ACEA, said October 15. (Gazdasági Rádió)